Mass. Unemployment Up 6.1%

By Matt Murphy
STATE HOUSE NEWS SERVICE

STATE HOUSE, BOSTON, AUG. 16, 2012….Massachusetts employers added 1,600 jobs in July, but the state’s unemployment rate ticked up slightly for the first time in three years to 6.1 percent, according to a Bureau of Labor Statistics report released by the Patrick administration Thursday morning.

A previously reported 2,600 job loss in the month of June was also revised to reflect a 600 job gain that month.

“These numbers are a snapshot and we always urge people to look at the trends and not the snapshot. The gain was the sixth straight month of growth in the Commonwealth which I think shows we are making steady progress,” said Secretary of Labor and Workforce Development Joanne Goldstein.

The last time the state’s unemployment rate rose was in September 2009. Despite the July increase by one-tenth of a point from 6 percent, the state’s unemployment rate is still well below the national 8.3 percent average.

“I don’t think it indicates necessarily that the economy is slowing down. We’re still growing jobs and we’re comfortable that we are continuing to grow in the right direction,” Goldstein said.

The largest job gain, according to the administration, came in the education and health services sector, which added 4,000 jobs in July. Professional, scientific and business services, construction and manufacturing also added jobs last month, boosting employment numbers by 1,000, 900, and 100 respectively.

The jobs numbers were released on the same day the Massachusetts Clean Energy Center reported that the clean energy economy grew 11.2 percent from July 2011 to July 2012. The sector now employs 71,523 people at 4,995 clean energy firms across Massachusetts and represents 1.7 percent of the state’s workforce.

The leisure and hospitality sector lost 1,600 jobs last month, according to the new report, while trade, transportation and utilities lost 1,100 jobs, financial activities lost 1,000 jobs and other services lost 1,100 positions.

“Leisure and hospitality I fund puzzling,” Goldstein said. “Anecdotally and factually it’s doesn’t seem like it’s slowing down.”

Government was another sector that added jobs in July, with state government posting a 600 job gain, the federal government adding 100 jobs and local governments downsizing by 200 jobs. 

The unemployment rate is based on a monthly sample of households. The job estimates are derived from a monthly sample survey of employers.

Andre Mayer, senior vice president for research at Associated Industries of Massachusetts, said it’s more valuable to look at the job growth trends over time than to try to try to read too much into a single month’s job report.

“The little uptick in the unemployment rate means nothing. What we’re seeing is very slow improvement, slow job creation but fairly consistently positive,” Mayer said.

After dropping off sharply in June, A.I.M.’s business confidence index rebounded part of the way, jumping 3.9 points in July to 52.2 and climbing back into positive territory.

“While there is a lot of uncertainty and concerns, the underlying pattern has been positive,” Mayer said. “Employers are very aware of the risks out there in the economy, the connection to Europe, which is moving into a recession, the so-called fiscal cliff that the people in Washington are dealing with and that certainly holds hiring back. We’ve never gotten to the point in this recovery that employers felt confident enough in the direction – therefore they’ve been reluctant to hire.”

Calling the overall recovery “a long slog,” Mayer said July, like January, is typically one of the most difficult periods for seasonally adjusted job growth, and the report reflects weak youth hiring and uneven employment in the summer construction industry.

The strength in the professional, scientific and business services sector, he said, stems from the fact that those fields tend to have to hire more people if companies are doing more business, as opposed to manufacturing where increased productivity can be squeezed out of the existing workforce.

The Bureau of Labor Statistics reported that Massachusetts has added 37,500 jobs in 2012, including 38,900 added in the private sector.  The July report found that 3,240,400 residents of Massachusetts were employed out of a total labor force of 3,451,300.